EACC ordered to supervise return of NYS Vouchers after court ruling

Court gavel/FREEPIK

The High Court has declined to lift orders blocking the payment of Sh6 billion linked to the National Youth Service (NYS) fake supply scandal. 

Justice Alexander Muasya Muteti extended the conservatory orders until January 15, 2026, maintaining a freeze on any payments pending the hearing and determination of the case filed by the Ethics and Anti-Corruption Commission (EACC).

However, in a significant development, the judge directed the EACC to release all vouchers and payment documents to the NYS accounting officer by the close of business on December 24, 2025. 

The documents are to be forwarded to the Pending Bills Verification Committee for scrutiny before the committee’s mandate expires on December 31, 2025.

Once the verification exercise is completed, the vouchers are to be returned to the EACC by January 14, 2026, to allow the commission to proceed with the case.

"For the avoidance of doubt, this court has not sanctioned any payment of the pending Bills pending the hearing and determination of this suit," the court ruled.

"The accounting officer NYS is directed not to effect any payments pending the final hearing and determination of this Notice of Motion or until otherwise ordered by the court."

The ruling arose from an application by the 5th and 6th defendants in the case, who argued that continued withholding of the vouchers by the EACC would unfairly prejudice them. 

They told the court that unless the documents were released in time, their claims would not be reviewed by the Pending Bills Verification Committee, effectively locking them out of any chance of payment even if they eventually succeeded in court.

The applicants contended that investigations into the matter had already been concluded and an inquiry file submitted to the Director of Public Prosecutions (DPP), who declined to institute criminal charges.

They further relied on reports by a multi-agency team and advisory opinions issued by the Attorney General in 2020, which recommended that verified pending bills be paid, subject to scrutiny of individual claims.

According to court documents, the multi-agency team, which included representatives from the EACC, had cleared pending bills amounting to about Sh5.37 billion, while recommending further investigation of vouchers worth about Sh812 million. 

The applicants argued that these findings had never been rescinded and accused the EACC of acting in bad faith by filing a civil suit they said was intended to frustrate payment.

The EACC opposed the application, warning that releasing the vouchers would render its recovery suit nugatory. 

The commission maintained that the documents were fraudulent and that any payment based on them would perpetuate loss of public funds. 

While conceding that the DPP had declined to prosecute, the EACC argued that it retained the statutory mandate to pursue civil recovery proceedings and preserve the disputed documents as evidence.

In his determination, Justice Muteti acknowledged that the court was being asked to issue a form of interim structural order aimed at preserving the rights of all parties pending a full hearing. 

He noted that the life of the Pending Bills Verification Committee was nearing its end and that failure to allow it to examine the claims would likely cause irreparable prejudice to the applicants.

The judge rejected the argument that verification of bills amounted to payment, stressing that the two processes were distinct and handled by different entities. 

He observed that the committee’s role was to establish the authenticity of claims and that, if the vouchers were fraudulent as alleged, the committee itself could flag them for further investigation.

Justice Muteti further held that the applicants’ right to property under Article 40 of the Constitution was at stake and that the court had a duty to ensure equality of arms between the parties. 

He ruled that releasing the documents to the NYS accounting officer for onward transmission to the verification committee would not compromise the EACC’s case, especially since the documents would remain within government custody and be returned to the commission within a defined timeframe.

Importantly, the court made it clear that it had not sanctioned any payment of the pending bills. 

The NYS accounting officer was expressly barred from effecting any payments until the application and the substantive suit are fully heard and determined.

The case is part of the long-running alleged NYS fiasco.

The court’s decision seeks to balance the public interest in safeguarding taxpayer money with the rights of suppliers to have their claims independently verified, even as the legal battle over the Sh6 billion continues.

EACC begun investigations when, on July 15, 2022, then Public Service, Gender, Senior Citizen Affairs and Special Programmes CS forwarded-payment vouchers and other documents requesting the Commission to undertake forensic investigation on the authenticity of the documents.